Reinsurance directive approved at last

The European Commission has welcomed last month’s vote in the European Parliament to approve the proposed directive on reinsurance. The directive would establish supervision of reinsurers by competent authorities in their ‘home’ country, on the basis of which they could operate throughout the European Union (EU). That supervision would have to be exercised in line with provisions which all member states would need to apply.

Internal market and services commissioner Charlie McCreevy said: ‘Excellent co-operation between Parliament, Council, and Commission has led to this major step towards a more efficient and secure cross-border market in reinsurance. The directive will fill a gap in current EU legislation, which does not regulate specialised reinsurers, and give insurance companies greater confidence in seeking the best deal available wherever it is to be found in the EU. More competition at this level should ultimately benefit policyholders. The proposed directive would also contribute to reinforcing international financial stability, an issue over which there has been concern in major international fora.’